Gov’t and BOJ surveys show harmful effect of Abenomics on people’s livelihoods

July 13, 2016

During the latest Upper House election campaign, Prime Minister Abe Shinzo boasted that his economic policy, “Abenomics”, has produced successful outcomes. However, data in government surveys regarding the economic situation and people’s livelihoods indicate a decline in economic indicators to the level before PM Abe returned to power in December 2012.

In the Internal Affairs Ministry’s survey on the household economy, the actual index for consumption expenditures of families with two or more members in May stood at 93.0. This index figure in December 2012 was 98.8. The Labor Ministry’s monthly labor survey in April showed that the actual wage index fell by 2.6 points to 95.7 from 98.3 in December four years ago.

The Cabinet Office on July 8 released a survey targeting “economy watchers” such as taxi drivers and restaurant staff. In the survey, the diffusion index (DI) for the current economic situation was 41.2, three months of deterioration and the worst level since PM Abe began carrying out the “Abenomics” policy at the end of 2012.

Even the Bank of Japan on July 12 announced that in its survey on people’s livelihoods, the percentage of respondents who feel the current economic situation is not better than that in last year reached 30%.

In the quarterly-survey that the BOJ conducted in June, the response that the current state of the economy has worsened from a year earlier accounted for 31.6% of the total, up 3.6 percentage points from the previous survey in March, while those who responded in the affirmative decreased by 1.2 percentage points to 4.3%.

The business sentiment DI deteriorated by 4.8 points from the previous survey to 27.3, a third consecutive quarterly drop. In addition, in the BOJ survey, indexes regarding people’s living conditions and wages declined by 1.6 points to 40.3 and by 3.2 points to 27.2 respectively. All three major indexes marked a deterioration for the first time since the September 2014 survey.